Property interests evince a near-universal tendency to coalesce into a limited list of mandatory forms, such as the estates in land, servitudes, and the forms of intellectual property. This standardization poses an intriguing puzzle for property theory. If property law is meant to bolster autonomy and enhance the efficiency that private ordering can bring to economic relations, how then to account for a persistent feature of the law that seems to undermine these goals? A number of scholars have grappled with this problem in recent years. Some have argued that aspects of standardization might actually be efficiency enhancing. Others have argued that standardization instead reflects inherent categories of social or objective meaning. Efficiency theories, however, overemphasize structure, while explanations focused on content underappreciate the architecture of standardization.

This Article proposes a new approach that focuses on the particular patterns of pluralism evident in the standard forms. Even as standardization remains a consistent feature of property law, the legal system constantly tinkers with the standard list and with the mandatory content of the forms themselves. This process produces a menagerie of forms that reflect the ongoing resolution of complex, competing values embodied in property law. The pluralism evident in the forms thus brings to the fore the essentially regulatory function of standardization. Standardization persists in property law because it provides a stable framework through which the legal system regulates the ever-changing public aspects of this central area of private property.

This pluralist account of standardization as regulatory platform sheds light on contemporary debates in property theory more generally, including the development of property rights, the relationship between intellectual property and more traditional forms of property, and the constitutional balance between individual expectation and state ordering in regulatory takings.

Ben Barros

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Much of the blame for the current financial crisis is attributable to problems in the subprime mortgage market. In this Article we argue that changes in the nature of the mortgage contract make it both legally plausible and normatively desirable that subprime mortgages brokers be treated as securities broker-dealers for the purposes of the Securities Act of 1933 and the Securities and Exchange Act of 1934. Modern subprime mortgages are, in large part, investments that contain imbedded options and are not subject to any alternative comprehensive regulatory regime. Thus, they should qualify as "notes" under the Securities Act definition and the Supreme Court's Reves test, and expose their brokers to Rule 10b-5 oversight. In the alternative, we argue that the emergence of securitization as the primary process by which mortgages are financed provides a second, independent analytical basis for our theory that subprime mortgages financings should be subject to securities law: Mortgage financings qualify for the protections of rules such as SEC Rule 10b-5 because they occur "in connection with the purchase or sale of a security," the mortgage-backed security that is created and funded on the basis of the cash flows from the mortgagors' payments on their subprime mortgages.

Were the SEC to take control of subprime mortgages brokers, rules that forbid the sale of financial instruments to any person unless investing in those instruments is appropriate (suitable) to the investment needs and risk tolerance of that investor would come into play, oversight that would have avoided or greatly mitigated the current crisis. In describing what suitability would do for the mortgage market, we make a novel distinction between "product" and "transaction form" suitability in our analysis of the suitability rules. We argue that transaction form suitability is the appropriate legal theory to use when pursuing people who have unscrupulously sold subprime mortgages to unsophisticated investors. In closing, we discuss reasons why we believe the SEC has not tried to exert this authority to date.

Ben Barros

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Over 4 million subprime loans were originated in 2006, bringing the total value of outstanding subprime loans over a trillion dollars. A few months later the subprime crisis began, with soaring foreclosure rates and hundreds of billions, perhaps trillions, of dollars in losses to borrowers, lenders, neighborhoods and cities, not to mention broader effects on the US and world economy. In this Article, I focus on the subprime mortgage contract and its central design features. I argue that these contractual design features can be explained as a rational market response to the imperfect rationality of borrowers. Accordingly, for many subprime borrowers loan contracts were not welfare maximizing. And to the extent that the design of subprime mortgage contracts contributed to the subprime crisis, the welfare loss to borrowers, substantial in itself, is compounded by much broader social costs. Finally, I argue that a better understanding of the market failure that produced these inefficient contracts should inform the ongoing efforts to reform the regulations governing the subprime market.

Ben Barros

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I'm finishing up Property I later this morning with continuing discussion of the recording acts, and couldn't help posting this amazing story. Turns out the NY Daily News "stole" the Empire State Building by filing fake deeds with New York's city register, including a witness named Fay Wray, notarized by Willie Sutton. (There's a serious issue of fraud the Daily News is highlighting, but a great way to tee up the limits of recordation!)

Houses of worship are among the most sensitive issues facing the landmarks commission. Mandating that a church be preserved can not only impose a heavy financial burden on a congregation, it also raises the specter of state interference with religious freedom. So the commission has been especially loath to take on churches or synagogues that don’t want to be designated.

But many preservationists and at least one commission member argue that the landmarks commission has not been aggressive enough in protecting churches from the overheated real estate market of the last few years. Given that churches tend to be low-rise buildings in choice residential locations, they note, the structures became prime targets for developers intent on building high-rise apartment towers.

Ben Barros

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The strategy has become wearyingly familiar to preservationists. A property owner — in this case Sylgar Properties, which was under contract to sell the site to Related — is notified by the landmarks commission that its building or the neighborhood is being considered for landmark status. The owner then rushes to obtain a demolition or stripping permit from the city’s Department of Buildings so that notable qualities can be removed, rendering the structure unworthy of protection.

Ben Barros

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